The government of India has approved an executive decree to increase foreign investment in the country’s insurance sector.
With this development, India’s insurance sector will see a hike in foreign direct investment (FDI) to 49% from the current 26%, The Wall Street Journal reported.
In July this year, the new government had agreed to increase the FDI in insurance sector as part of its new economic agenda.
Indian finance minister Arun Jaitley was quoted by the WSJ as saying: "The ordinance demonstrates the firm commitment and the determination of this government to reforms.
"It also announces to the rest of the world, including investors, that this country can no longer wait, even if one of the houses of parliament waits indefinitely to take up its agenda."
The latest ordinance will now be placed before both houses of parliament for approval and the parliament needs pass it within six months to make this decision permanent.
This decision is expected to bring $6bn to $8bn of foreign investment in country’s insurance sector over the next few years, Jaitley added.
Image: India’s decision to increase FDI in Insurance sector would bring $6bn to $8bn investment. Photo: courtesy of Stuart Miles/FreeDigitalPhotos.net